Companhia Brasileira de Distribuicao (PCAR3) Q1 2026 earnings summary

Executive summary

• Filed and negotiated an extrajudicial recovery plan to restructure R$4.6 billion in debt, extend maturities from 2.1 to 6.4 years, and reduce average cost of debt to CDI + 0.5%, with over 57% creditor support and court approval pending.

• Achieved 0.6% same-store sales growth year-over-year, with all banners contributing positively despite a 5.2% total sales decline due to the discontinuation of the Aliados format and portfolio adjustments.

• Gross margin expanded by 2.9 p.p. to 30.4% and adjusted EBITDA margin rose to 10.5%, driven by operational improvements and higher-margin channels.

• Adjusted net loss from continued operations was R$333 million; reported net loss was R$1,347 million, mainly due to R$1,014 million in non-recurring and non-cash effects.

• Focused on operational efficiency, cost reduction, and cash generation, with management consolidation and a strengthened executive team.

Financial highlights

• Net revenue declined 8.2% year-over-year to R$4.37 billion, while gross profit increased 1.3% to R$1.33 billion.

• SG&A expenses reduced by 3.5% to R$917 million, reflecting efficiency plan gains.

• Operating free cash flow after CapEx reached R$522 million, up 65.2% year-over-year.

• Capex for 1Q26 was R$87 million, a 55% reduction year-over-year, aligning with the annual target range of R$300–350 million.

• Net financial expenses increased 20% to R$382 million, reflecting higher debt costs and lower cash balances.

Outlook and guidance

• Capex guidance for 2026 set between R$300 million and R$350 million, with no new store openings planned.

• Efficiency plan targets at least R$415 million in annual cost reductions, with R$99 million captured in 1Q26.

• Pro forma net debt expected to fall to R$822–851 million, a 74.3% reduction, with leverage projected at 0.9x.

• Continued focus on operational efficiency, cost control, and customer experience.